Mon, 25 Jan 2021 | BUSINESS SALE
Online retailer Boohoo has acquired the Debenhams brand in a £55 million deal that will see the company’s 118 remaining UK high street stores close. Boohoo said that the remaining stores would be wound down when they are able to reopen after COVID-19 lockdown.
A statement from Boohoo confirmed: “The group will only be acquiring the brands and associated intellectual property rights. The transaction does not include Debenhams’ retail stores, stock or any financial services.”
Debenhams has been searching for a buyer since last summer after going into administration for the second time in a year in April 2020. JD Sports had looked set to acquire the department store chain in November last year, before the collapse of Arcadia – Debenhams’ biggest concession operator – caused it to end its interest.
Administrators had begun closing the business down after failing to secure a rescue deal, while it had already been announced that six stores, including the flagship Oxford Street branch, would not reopen following lockdown.
Administrators FRP Advisory said: “This transaction will allow a new Debenhams-branded business to emerge under strong new ownership, including an online operation and the opportunity to secure an international franchise network that will operate under licence using the Debenhams name.”
While Debenhams’ remaining stores are now set to close, there could be some interest in acquiring some of its locations. One potential bidder for some of the Debenhams store portfolio is Mike Ashley’s Frasers group, which has a long-standing interest in the retailer.
Boohoo executive chairman Mahmud Kamani commented: “This is a transformational deal for the group, which allows us to capture the fantastic opportunity as e-commerce continues to grow. Our ambition is to create the UK’s largest marketplace.”
“Our acquisition of the Debenhams brand is strategically significant as it represents a huge step which accelerates our ambition to be a leader, not just in fashion e-commerce, but in new categories including beauty, sport and homeware.”
Boohoo, which has benefitted from the rise of online shopping during the COVID-19 pandemic, will also acquire Debenhams’ sub-brands Maine, Manataray, Principles and Faith. The group has already acquired the brands of Oasis, Coast and Karen Millen from administration during the pandemic and could seek further strategic and distressed acquisitions as it looks to expand its range.
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